Hargreaves Lansdown marketing just a load of rubbish?

dunstonh

For some considerable time I naively thought cutting the middle man out, IFA's etc, and dealing with Fund Managers direct would be the cheapest way to invest. It wasn't until I came to this site that I realised there were trousering 3% of the investment in iniital charges.

And keeping the IFA trail commission and keeping the hidden rebate.

I now save that, and some annual charges by using HL. I could also use other similar fund supermarkets.

Although you are still paying for the hidden rebate and you are paying most or all the IFA trail commission (Depending on wrapper used) despite not getting IFA services.

Yes its possibly a bit cheaper (except with HL SIPP) but its not perhaps as quite as cheap as it should be.

kar999

dunstonh wrote: »

Although you are still paying for the hidden rebate and you are paying most or all the IFA trail commission (Depending on wrapper used) despite not getting IFA services.

Yes its possibly a bit cheaper (except with HL SIPP) but its not perhaps as quite as cheap as it should be.

Yep.. I could probably save some more but I'm streets better off than I was by dealing direct. I did also get £250 cashback for switching my PEP/ISA portfolio to their Vantage S&S ISA wrapper at the turn of the tax year so I was quite happy with that (rather than the pen they are offering now!).

dunstonh

kar999 wrote: »

Yep.. I could probably save some more but I'm streets better off than I was by dealing direct. I did also get £250 cashback for switching my PEP/ISA portfolio to their Vantage S&S ISA wrapper at the turn of the tax year so I was quite happy with that (rather than the pen they are offering now!).

Bringing it back to the thread subject, we have seen people in the pensions section move their pensions from stakeholders or personal pensions to the HL SIPP based on HL marketing telling them that their SIPP is low cost.

When they have told us the funds, frequently it has been the poor quality and expensive HL multimanager funds used with a TER that was nearly twice the cost of the existing pension. They had fallen for the HL marketing but didnt have the understanding to actually check the figures for themselves and moved from a pension with 1% AMC to one with a 1.83% TER. It also turned out that the fund they were in with Aegon was not only cheaper but was also outperforming the fund they chose with HL.

If that had been done via an IFA, then it would be classed as a mis-sale. However, as he used DIY, it cannot be.

Had he gone to an IFA he could have got a modern version of his personal pension and got that same fund for around 0.5% reduction in yield.

So, HL is not always the cheapest. It is not always the best. You need to know what you are doing to use them and if you do then its a very good option if you want to DIY. However, if you dont know what you are doing and rely on their marketing, it could be an expensive folly.

blinko

jamesd wrote: »

Dealing cost: £10 a trade with iii for an ETF, £0 for a fund with HL.

Management charges:

0.47% Fidelity Multi Asset Growth Fund
0.65% BlackRock DC Diversified Growth Fund
0.75% Newton Real Return Fund
0.10% BlackRock Aquila Life UK Equity Index Fund
0.25% BlackRock Aquila Life World Equity (ex-UK) Index Fund
0.15% BlackRock Aqua Life (60:40) Global Equity Index Fund
0.10% BlackRock Aquila Life Over 15 Years Gilt Index Fund
0.15% BlackRock Aquila Life Cash Fund

Those are the AMCs in one of my work pensions. No dealing charges.

Try beating those costs for say £100 a month regular contribution to a FTSE All Share Index tracker ETF, where the iii buying cost of £10 is effectively a 10% initial charge.

The trading costs are why it can be a good idea to accumulate money in a fund and then switch a lump to an ETF, if you can find a cheaper ETF, when the amount makes the dealing cost negligible.

For that same work pension I'm currently being offered a section 32 buyout with these TERs from Fidelity:

0.63% Fidelity Multi Asset Growth Fund
0.92% Fidelity BlackRock Diversified Growth Fund
0.90% Fidelity Newton Real Return Fund
0.14% Fidelity BlackRock UK Equity Index Fund
0.15% Fidelity BlackRock World (ex-UK) Fund
0.15% Fidelity BlackRock Long Term Fund
0.14% Fidelity BlackRock Over 15 Years Gilt Index Fund
0.18% Fidelity BlackRock Cash Fund

A range of other investments available, not an appropriate set for me, though.

Here are the closest Hargreaves Lansdown fund equivalents to show how uncompetitive HL can be sometimes when compared to quite competitive pricing:

1.5% Newton Real Return (vs 0.9% or 0.75%)
0.25% HSBC FTSE All-Share Index (Inst) (0.27% TER) (vs 0.14% or 0.1%)

Yet even though there I was showing how HL was higher price than some options available to me, that HSBC FTSE tracker is still likely to be cheaper than most FTSE ETFs once you consider all of the costs, including dealing. For HL those prices can make HL pretty competitive on price for those who just want some trackers.

I thought you were talking about drip feeding, you should have made that clear in your post. I was wondering how you got your its cheaper to invest in unit trusts.

You also haven't mentioend the spread and the exit charges (they simply widen the spread)

ETF's are a much cheaper way to get exposure to an index, ok if you pick on low figures which I can only assume you did to prove your point but lets pick bigger figures eg 10,000k.

The dealing costs become negligable £10, yet the movement of the spread will on a unit trust will !

blinko

jamesd wrote: »

The people who don't know much about how things work. The same people who walk into a bank and expect to get the best investment deal around. Lots of those around. Even people like me for a little while as I learned about things. The normal reaction is to believe the claims when they are so well presented. It's only later that people may learn more about how things work and see the blend of things involved.

I think you're treating almondsalty badly, to the point where I considered briefly the idea of reporting your posts for failure to be suitably nice to all moneysavers. You should really concentrate on the subject, not the person. Telling someone to go away is a pretty clear sign that you're starting to be critical of the person rather than their arguments. It's also very hostile questioning to repeatedly ask the same question as often as you have, with the range of answers that have been given.

This doesn't mean that I agree or disagree with any particular argument. You're both making interesting points that will be educational for those who don't know how things work.

I strongly disagree, you are being naive in your thoughts on him

I have asked him the same question repeatedly he has avoided it, I will repeat

"when you first saw the wealth 150 that you thought it was complex maths models behind the selection." ?

Yet his argument falls down at every step when it is challenged

He has made up a username PURELY to have a go at HL

he is overall chatting alot of rubbish and bashing HL for whatever reason

the bottom line is we do not need on this forum
people making up usernames to slag off companies that haven't done anything wrong.
people coming on here with weak arguments and wasting everyones time
when you challenge the argument they avoid it and continue slagging off the provider with there weak arguments

so its for these reasons that for me I think you are wrong to defend him

kar999

dunstonh wrote: »

Bringing it back to the thread subject, we have seen people in the pensions section move their pensions from stakeholders or personal pensions to the HL SIPP based on HL marketing telling them that their SIPP is low cost.

So, HL is not always the cheapest. It is not always the best. You need to know what you are doing to use them and if you do then its a very good option if you want to DIY. However, if you dont know what you are doing and rely on their marketing, it could be an expensive folly.

Agreed. I DIY research and select but invest via their S&S ISA wrapper.

They have tried to sell me their SIPP's but to be fair to them they strongly suggested I spoke to my current pension pot providers (mainly Legal & General) to see if I would lose any benefits.

I did look into this and have not moved to HL.

As with any company, marketing is there to promote their products and services to maximise their profit. H&L are no different to any other company.

darkpool

blinko wrote: »

He has made up a username PURELY to have a go at HL

the bottom line is we do not need on this forum
people making up usernames to slag off companies that haven't done anything wrong.

i don't see any username that insults HL? you do seem very aggressive, you not having a good day?

almondsalty

darkpool wrote: »

i don't see any username that insults HL? you do seem very aggressive, you not having a good day?

I don't understand Blinko. Isn't everyone's username on a forum 'made up'? I'm sure his real name isn't Blinko.

I have answered his questions many times with a lot of detail. But he ignores them.

One of his very few posts in these boards six years ago or so ago was a direct link to HL asking people to 'refer him' https://forums.moneysavingexpert.com/discussion/31658

Seems a very strong advocate of the firm for some reason. Only someone with such passion to ignore calm and logical discussions leads me to believe there is some affiliation there.

blinko

almondsalty wrote: »

I don't understand Blinko. Isn't everyone's username on a forum 'made up'? I'm sure his real name isn't Blinko.

I have answered his questions many times with a lot of detail. But he ignores them.

One of his very few posts in these boards six years ago or so ago was a direct link to HL asking people to 'refer him' https://forums.moneysavingexpert.com/discussion/31658

Seems a very strong advocate of the firm for some reason. Only someone with such passion to ignore calm and logical discussions leads me to believe there is some affiliation there.

Once again you put your argument forward, I challenged it and your reponse is to avoid my questions ?

almondsalty

blinko wrote: »

Once again you put your argument forward, I challenged it and your reponse is to avoid my questions ?

What on earth are you talking about? What was your latest challenge exactly? Your 'challenges' are usually a few lines of angry text, which ignore my points. And who are you to attack my explained opinion all the time? Discussion/debating is fine, but attacking isn't.

Go back and read my responses fully. I have provided 'my argument', you are just acting like a 12 year old kid who is purposely being annoying, sat in the back of the car asking 'are we there yet', when your parents have told you where the car is 10 times. You can tell your responses are full of hate and anger because of all the typos despite few characters.

And for the record, you have 'avoided' my question a lot of times now which is are you a HL employee or affiliated with them? Your behaviour draws great similarity to what is known as a 'fanboy' online, or a an employee of HL in some capacity.